Unfavourable exchange rate plays havoc with music festival budgets

Some of Calgary’s largest music festivals are facing a budgeting predicament as the struggling loonie has raised artist fees at a time when corporate sponsorship dollars and the disposable income of Calgarians are becoming increasingly rare.

Kerry Clarke, the artistic director of the Calgary Folk Music Festival, says the current Canadian-American exchange rate is having an impact on the booking of this year's festival lineup.

“It limits the ceiling of what we can pay on artists for headliners because we still want to balance having 65 to 70 artists at the festival and having a deep lineup with a lot of diversity,” explains Clarke. “My job is to deliver a really wonderful, diverse, exciting, interesting lineup with a combination of artists that are fresh to the festival and the city and artists that have been here before that people love.”

The American dollar has become the gold standard in the music industry and Clarke says it’s not only American artists who negotiate in greenbacks.

“There are some Canadian artists that, as their careers grow and they sometimes have a U.S. agent, they’re paid in American dollars.”

Artists fee account for roughly a quarter of the festival’s operating budget.

“It is one of the bigger costs, one of the bigger outlays, and obviously it’s important because we’re a music festival and people are coming to see the artists.”

“We’re looking (to spend) under $100,000 for one big individual headliner,” said Clarke. “We’ve never paid more than $75,000 for an artist.”

Despite the escalating cost of booking artists, the festival will not be raising ticket prices in 2016

“We don’t think that we can justify putting (the cost of) tickets up in this economy. We don’t think there’s an appetite for it.”

Clarke says the festival has lost several sponsors during the recent economic downturn forcing organizers to become creative in who they approach for sponsorships. Despite the financial obstacles, Clarke knows the festival will persevere.

“We’ve been around for 37 years. We’ll weather this challenge.”

The organizers of Sled Island, the music, comedy, film and art festival, know a thing or two about facing adversity. The historic flooding of the Bow and Elbow Rivers in June 2013 prompted the cancellation of that year’s festival.

“It’s never been easy running a festival like ours,” said Maud Salvi, Sled Island’s executive director, “This year, (the challenge is) the American dollar and we’ll face it the best we can.”

Salvi says the 2016 edition of the festival, which will feature approximately 250 artists, will be of the same calibre as previous years despite the fact artist fess, paid in American dollars, now cost 30 to 40 per cent more.

“We definitely do not want to cut back,” said Salvi. “Our programming, our curation, is our biggest asset (and) why we draw people to the festival.”

Salvi says raising additional private funds is a possible solution to the current exchange rate dilemma as organizers do not want to burden music fans with the cost.

“We do not want to raise ticket prices because we’re also aware of the economic situation in Calgary and Alberta at large,” said Salvi.

Ever the optimists, Sled Island organizers view the current economic challenges as an opportunity to increase exposure both locally and south of the 49th parallel.

“The silver lining to that situation is people in Canada are going to tend to stay in Canada for their music festivals,” explains Salvi. "Potentially, more people from the United States will be tempted to come to Canada because it’s going to be so cheap for them.”

Sled Island 2016, guest curated by Peaches, will run from June 22 – 26. The festival’s first lineup announcement is slated for February 8.